Obama begins forming cabinet

Chicago: US President-elect Barack Obama moved quickly to establish his cabinet, asking Illinois congressman and former Clinton adviser Rahm Emanuel to head his White House staff.

Emanuel, a Washington insider who also hails from Chicago, is expected to accept the position of chief of staff, which is the highest-ranking position in the White House staff.

Obama, who made history on Wednesday by becoming the first African-American to be elected US president, has until January 20, 2009 to put together his cabinet.

He may announce Emanuel's appointment and possibly other key posts, such as Treasury secretary, on Thursday.

A transition team is already in place and aides were "working fast to fill Obama's economic and homeland security teams," a Democratic source said.

The daunting task awaiting the new president includes two wars, a worsening economic crisis and tough social issues.

Current President George W Bush has said he will do everything possible to make the transition as smooth as possible.

What are the biggest challenges that Obama will face? How will Joe Biden be able to contribute to America's relationship with the rest of the world?